3 Things Every First Time Homebuyer Needs to Know
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I’ve gone from being a first-time homebuyer to a new homeowner for only a few weeks now, but it’s already been quite the rollercoaster. So far, our dishwasher broke, our hot water heater broke and the electricity went out twice. I’m not even moved in enough to know where my socks are, and I feel like I’ve already spent a ton of money just to get the house in working order.
Don’t get me wrong. We’re really excited to be first-time homeowners. We love our house. It has quite a bit of charm since it was built in 1942, including all sorts of interesting little nooks and crannies. My favorite part is that I have the entire upstairs to myself as my mom-cave. I’ve never had an office in six years of writing online, and now I can actually lock my door and people will stay out of my space. Quite luxurious indeed.
That said, I’ve been thinking of some tips that I’d like to pass on to anyone else out there who might be a first-time homebuyer looking to buy their first home soon.
Build an Emergency Fund
Whether you’re shopping for a starter home or a fixer upper with charm, you definitely need an emergency fund. Like many other first-time homebuyers, we had a thorough inspection of our home and made a detailed list of everything that needed to be repaired.
During the home inspection, everything worked just fine in the house, including the dishwasher and hot water heater. Then, the first week we moved in, it all started to break.
It’s hard to build an emergency fund before buying a house because you’re focused on saving enough for the down payment and closing costs; while an emergency fund is just as important, it often becomes an afterthought. Once you’ve got the first two savings goals hit, it can be very hard to delay house shopping until you have a few thousand dollars saved up in your emergency fund. However, as evidenced above, you will need that savings because homeowners have to fix things that break all the time.
Get a Home Warranty
Our realtor recommended that we ask for the seller to buy a home warranty for us as part of our purchase negotiations. I’m glad she recommended this because, as mentioned above, we’ve already used it.
For example, when it came to the hot water heater, we only had to pay for a $75 service fee, but our home warranty covered the actual replacement part to get it heating our water again. We were so glad when it was all said and done. I’m pretty sure I would have paid anything to not bathe my two-year-olds in cold baths anymore. I’m sure you can imagine how well that went for me.
The seller of our house only spent a few hundred dollars on our home warranty policy for us and it covers us for a whole year. Even if your seller won’t spring for a home warranty, you should because in the grand scheme of spending thousands of dollars on closing costs and down payments, a few hundred more for a home warranty could save you money down the line.
Take Your Time With Upgrades
The only thing I want to do in life is go to Target and get every single organizing bin and decorative pillow they sell. Of course, I can’t do this because I have a mortgage to pay. However, I’ve been trying to get a few little things at a time to make our home look nice.
When you’re a first-time homebuyer who’s just purchased your first home, it’s tempting to go out and spend a lot of money on decorations and new furniture, but take your time. It might be more valuable to spend your money on upgrades that will improve the value of your home.
It also pays to shop around. Most of my living room furniture comes from IKEA, because let’s face it, I just can’t fathom spending thousands of dollars on furniture right now. Someday I’ll feel like a real grown up with beautiful furniture, but on that day I probably won’t have twin toddlers running around.
Overall, buying your first house is an exciting process, and with 32 percent of homebuyers last year being first-time home buyers, there are definitely a lot of you out there.
After going through the process myself including buying a home in another state, I can say that it pays to do your research ahead of time, know what you want, be willing to be flexible and not to go overboard. We’re really happy with our little bungalow that we bought and we look forward to making it ours and creating a lot of memories here.
Are you a first-time homebuyer who’s now a first-time homeowner? If so, what was your first time home buying experience like? If you’re a seasoned homebuyer, what are your tips for saving money and having a good experience?
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